Home > Uncategorized > Good growth or not?

Good growth or not?

The last quarters growth in the UK was a pretty decent 0.8% but what is fuelling this?

Here is a rather sceptical assessment http://www.theguardian.com/business/2013/oct/25/uk-growth-sustainable-gdp-data We would not perhaps expect a Guardian writer to be a cheerleader for Osbourne but is there some substance to her claims that this is being fuelled primarily by credit card spending? It could certainly be the case that after such a long downturn, consumers are simply spending again regardless. The weakness in her argument is that she confirms that the stats have not been confirmed

My view is that rising property prices are the major catalyst for growth. Some might say this is a bubble and its true that the rises in London have been extraordinary but the alternative view is that it is a vote of confidence in future prospects. Against this there is a the drain of inflation caused largely by the fuel prices which will adversely affect much consumer sentiment and as ever in economics, its the sentiment even more than the numbers that really drive the trends.

Thats my theory anyway

It is going to be an interesting year

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